News / Ontario struggling with online choices

Ontario struggling with online choicesJeudi, 28 mars 2013

A year ago, the Ontario Lottery and Gaming Corporation, OLG, announced it was preparing to step into the new millennium. The vast project included building casinos possibly in as much as 39 towns, most notably in the Greater Toronto Area. The GTA project is the most controversial one. As Las Vegas based operators flocked to Toronto in hopes to be chosen to build a multibillion dollars project, the people of Toronto have been cold, to say the least, in their reaction.

The online situation is more puzzling. OLG's original plan was to disregard what the rest of Canada was doing and issue licenses to private companies already offering casino and/or poker online in what could at best be described as a grey area. Contacted earlier this week, Mari Le Coche, Strategic Sourcing Director, would not comment, merely stating: "We are currently in the final stages of procurement to determine the primary service provider for online gaming services. To protect the integrity of the procurement process more information cannot be disclosed at this time."

Still, while they will decide soon, nothing transpires so far, as the OLG concentrates their PR work in land based casinos. OLG faces a tough decision: join the ROC or form their own network by issuing licenses. Here's a look at what might be the consequences of either choices:

Ontario joins PlayNow and Espacejeux

By doing so, OLG has to start from scratch and build a marketing/supervising team which would oversee every part of the operations, except for the technological part, since they would join the platform that currently runs on BossMedia. Adding the biggest province to the mix would insure any new province looking to jump on the online network, but most important, having 4 of the 5 largest provinces together would make the network a suitable option for Canadian players. The addition of Ontario would almost double the current traffic and bring it to over 25 million.

The move would also facilitate future discussions about inter countries online gaming. What Americans are currently experiencing reflects what could happen eventually in Canada in years to come. While Americans are for the most part praying to see the federal government step in and make sure the playing field is the same everywhere, Ontario residents are helpless as they have no voice in this discussion. Still, a united Canada would be the only option if we are to enter discussions in the future, as the European experience prepares us for.

Joining the Canadian network would allow the OLG to benefit from being able to regroup all its activities on the same roof, allowing it to offer lotteries and sports betting as well as the traditional casino games.

Ontario grants licenses

This represents the fastest way to offer regulated online casino games and poker to Ontarians. While only a few adjustments to the Gaming Commission would be necessary, they are still major adjustments. Ontario has never dealt with online gaming before so they would have to establish a whole new set of procedures in order to make sure the licensed operators conduct their business in a proper, ethical fashion.

We have all seen the perils of licensing blindly, as some "gaming jurisdictions" have proven in the past. The Alderney Gaming Commission serves as a great example of the perils of laxity in such a domain. While some companies appear quite legitimate, most of them being publicly owned, Ontario's lack of experience in this field poses a real issue, not only in regulating but in taxing appropriately. France proved to all that there are dangers in moving into a new field without proper assessment, and this only comes from experienced people.

On the other hand, the OLG would give Ontario players what they really want: the possibility to play one a site of their choice. We all understand poker players want to play on PokerStars and one other site, whether the other one is a top 3 room, Party Poker or IPoker, or a smaller, more convivial room. For casino players, having the choice between Caesars, 888 or Party would be good, but not different from what PlayNow/Espacejeux already offers them, so no difference in reality.

Is there a key in this decision?

I believe so. As Europe is our best (and only) example here, most countries started quite the same way: legalize, license operators, and tax them. Then, as they saw that their market was too small to survive alone, unite with neighboring countries. Americans are facing the same dilemma with their intra state legislations. Some licensing online poker only, while others would allow any casino game, just as they do in their brick and mortar casinos and racinos. In their case, if the federal government doesn't intervene, they are doomed as interstate gaming will become far too complex once they each have their own rules and procedures. In this debate, PokerStars is the prime example! In this instance, while some states would greet them with open arms, others would prefer to punish them for staying in the US market after the UIGEA. It does not matter here who's right and who's wrong: having different sets on criteria to determine who can be in and who should stay out only hurts the whole process.

Ontario will create the same kind of dilemma if they go their own way. For the immediate future, while the ROC would prefer they join in, Ontario can very well do what they want. 5 years from now, once they have 2 or 3 years of running an independent system, it will be very difficult for them to justify why it would be so complicated to join a Canadian venture with other countries. At the same time, the opposite would be unthinkable!

If you had asked me 5 years ago, my answer would have been exactly the opposite of what it is today: today, I hope Ontario joins in and merges the rest of Canada to prepare a better future, no matter how the future looks like in a few years.